JAMM AQUINO / JAQUINO@STARBULLETIN.COMThe Gold Bond Building, on Ala Moana Boulevard, has recently been put up for sale. The building's assessed value is $35.7 million, according to state records. CLICK FOR LARGE

Former Gold Bond building for sale

It is on the block just three years after being sold for $20.4 million

The former Gold Bond Building in Kakaako is for sale, just three years after it was sold to a California real estate development firm.

Eastdil Secured LLC, a New York brokerage firm, has quietly begun marketing the 12-story leasehold building to capital market investors. The building has a long-term ground lease on 1.4 acres owned by Kamehameha Schools.

San Francisco-based Ellis Partners LLC bought the building, officially named the 677 Ala Moana Building, in June 2004 for $20.4 million and is seeking offers from multiple buyers. The building's assessed value is $35.7 million, according to state records.

Brokers familiar with the marketing who asked not to be identified said the owners have not set a price on the building, which has attracted a number of prospective buyers.

A representative from Eastdil Secured and its local agent, Linda Gee of PM Realty Group, declined to comment.

The building has about 266,000 square feet of office space with retail on the ground floor and a 513-stall garage.

Its sale will likely result in a significant return on investment for Ellis Partners, which bought the building before islandwide office rents began to skyrocket.

Over the past three years, rents have jumped by about 25 percent while vacancy rates have fallen from 14 percent to 7 percent, said Mike Hamasu, director of consulting & research at Colliers Monroe Friedlander Inc.

"Whenever you see a significant jump in rents over the last couple of years, that draws attention," he said. "For those who purchased properties three to four years ago, they bought at a time when rents were a little depressed."

In the first quarter of 2007, the islandwide average asking rent rose to $2.65 per square foot a month, while premiere high-rise building rents jumped to $2.88 per square foot -- the highest it's been in 15 years.

While brokers declined to disclose the value of the leasehold building, recent fee-simple office building sales have fetched between $2.40 and $2.80 per square foot.

Built in the 1960s, the office building was originally named after the Gold Bond Stamp Co., a Minneapolis-based company that had been its anchor tenant for years.

Ellis Partners bought the building from Connecticut General Life Insurance Co., which in 1996 purchased it from a partnership that included local developers Dick Gushman and Duncan McNaughton.